ROI = Return on Investment. Which basically means how much money are you making from the money you already put in. (Bear with me here, I only took one business class in college and that was pre-accident, so the majority of that sucker is gone and what I do know is self-taught.)
Simply put, you pay $15 for an advertisement, you should expect to at least get that much back and, if all goes well, see profits over and above that $15.
In order to make $15 from a $2.99 ebook, you need to sell about 8 books. Sounds simple, right?
It is for the most part. Especially if right after the ad appears, you see 8 books get purchased. What makes it a little sticky is when you don't see 8 books fly off the proverbial shelf. You see 2. Then the next day, you see 3. Maybe you have a couple dry days and then the weekend hits and you see another 4 books sell. You've hit your advertising goal of breaking even, but how can you know for sure if the ad brought you those sales or if those readers found your book another way?
Throw in the fact that you also did a Twitter campaign and maybe a free ad also rolled out or a reader talked about your book on their blog or you got a nice new review, and you're pretty much toast for having any actual data from which to base your next advertising purchase.
Oh, you could do the annoying thing and try to poll your readers. "Where did you find out about my book?" But I think only a few readers actually answer polls, so it skews the numbers. (And I'm totally not a fan of polls or statistics because they can be skewed so many ways, they're hard to depend on.)
To put it more into perspective, I ran a couple free events this month - one before Accidental Death launched and one after. Pre-order sales were flat, so I'm pretty sure my 'before' event didn't get the folks clamoring to read my book. The 'after' event hit and that day was pretty much crickets, but then Friday, sales shot up to a record high (record for me - which wasn't high by anyone else's standards, I think, but it worked for me). Since it was also 'launch week', I did some FB things and Twitter things, so I'm not really sure exactly what made the sales soar. Hell, it could've been that people were waiting until Friday to buy my book because that's when their paycheck hit their account, so they had fundage to buy the book - which would account for the slow rest of the week. :shrug:
Today, I'm scheduled to have a paid ad in the Ereader News Today for Dying Embers. (Long story as to why I'm pimping DE instead of AD here. I might go into that another day.) Since Dying Embers is currently 99 cents, I will need to sell roughly 85 books to break even. The hope here is that sales of DE lead to sales of AD (of which I would need 15 sales to cover the cost). I'm also hoping Friday's sales of AD lead people to buy DE, but that's neither here nor there.
And then there's the fact that DE is now available through most other distribution channels, and they don't give real time numbers on sales, so I won't know if the advertising worked there for like 60 days...
See what I'm saying? How does one know when the marketing is working? As long as the sales are there, something is working. right? There's the old phrase 'time will tell', but I doubt it's telling me what I need to know.
I guess I'll just have to keep writing the next book and the next book and the next book, and let the sales sort themselves out. (Still, the business person in me wants a better metric...)
I'd do a poll right now, but I'm pretty sure if you're here, I know how you discovered my books. If you're new here, though, tell me how you stumbled across me and my books. The data might be skewed, but skewed data is still data. =o)